The Future of Decarbonization
The Net Zero Challenge
Net zero energy has been a goal of high performance building designers for more than a decade. A net zero energy building generates as much energy using renewable technologies as it consumes on an annual basis. A report from the New Buildings Institute in 2020 documented approximately 700 verified or emerging net zero projects. With such a low number of projects, net zero energy is clearly a huge challenge.
Now an even more challenging net zero has emerged, and this one isn’t going to have such low numbers for achievement. Net zero carbon is here to stay as developers, corporations, financial institutions and cities are setting goals and creating roadmaps for zero carbon emission by 2040 and 2050.
Decarbonization, which simply means reducing carbon, has become the major challenge of building designers and existing building owners. Designing a new building for zero carbon emissions typically requires full electrification and no use of fossil fuels. Electrification allows for carbon emission offsets from renewable energy sources such as solar photovoltaic and wind generation. Fossil fuel offsets are more difficult to offset as they require capture and storage, which often is not achievable on a building site. Many leading building developers are embracing the decarbonization challenge. Global real estate company Lendlease has set a goal to achieve net zero carbon by 2025 and absolute zero carbon by 2040 (absolute means zero emissions).
Cities throughout the United States are creating and implementing decarbonization policies. Energize Denver, which went into effect March 1, 2023, is a phased electrification program that will eliminate fossil fuel space and water heating equipment. In 2024, New York Local Law 97 begins which has large fines for building emissions exceeding carbon caps. A similar policy is being drafted in Chicago that would begin in July of 2025.
Businesses Leading The Way
Existing buildings comprise approximately 80% of the buildings that will exist in 2050. Maintaining these buildings versus destroying them and building new preserves the embodied carbon they hold in the structure. The challenge becomes reducing their operational carbon. Global real estate firms including Hines and Ivanhoe Cambridge have set net zero carbon goals by the year 2040 for their entire portfolios and are studying innovative ways to retrofit their buildings to minimize energy, water and carbon consumption.
Decarbonization goes beyond buildings. Global logistics giant DHL has published a roadmap of how they are decarbonizing their buildings and logistics fleet by 2050. Truck leasing company Penske is incorporating sustainable design practices for their new facilities based on the U.S. Green Building Council LEED rating system and are researching and piloting industry leading battery electric vehicle (BEV) technology for their fleet. The strategies and lessons learned as business leaders work to decarbonize their footprint will serve as an accelerator to other industries and building sectors.
Investment In the Future
The Inflation Reduction Act of 2022 is a major catalyst for decarbonization efforts in the United States. The Act provides economic benefit for investments in domestic energy production and renewable technology manufacturing, and is expected to lead to a roughly 40% reduction in carbon emissions by 2030. Enacted in August 16, 2022, investments in the United States have already shifted from Asia and European economies. Other economic catalysts include the massive increase in the 179D Tax Deduction from $1.80/SF to $3.00-$5.00/SF, the ENERGY STAR and Zero Energy Ready tax credit for residential, Clean Energy Investment Tax Credit and the Electric Vehicle Charging Credit.
Navigating A Complex Path
Net zero carbon and decarbonization are not paths that are easy to navigate. Cyclone Energy Group helps study, plan and advise building developers, owners and operators on how to achieve their carbon reduction goals. Often this requires benchmarking, simulation models, commissioning and post-construction measurement and verification. Contact us today to learn more about decarbonizing your buildings.